* MSCI Asia ex-Japan down 0.2 pct, Nikkei opens down 1.9 pct
* Dollar remains pressured on Fed tapering uncertainty
By Chikako Mogi
TOKYO, June 13 Asian shares hovered near 2013
lows and Japanese stocks took another dive as the prospect of
less stimulus from central banks depressed sentiment, while the
U.S. dollar fell further against the yen amid uncertainty over
the Federal Reserve's policy outlook.
Global stocks, commodities, bonds and currencies have been
roiled in recent weeks on concerns the Fed could scale back its
massive stimulus measures in coming months.
A lack of additional stimulus from other major central
banks has also deepened the sombre mood, as the European Central
Bank held off from lowering interest rates despite the euro
zone's sluggish economy while the Bank of Japan decided against
fresh steps to quell heightened volatility in domestic bonds
that has threatened to undercut its ultra-easy monetary policy.
"Market volatility is expected to stay elevated until the
Fed's policy meeting next week, at which we may see more clarity
into the tapering issue," said Yuji Saito, director of foreign
exchange at Credit Agricole in Tokyo. "If volatility in stocks
subsides, currencies will return to trading on fundamentals."
The Fed's next policy meeting will be held next week, on
MSCI's broadest index of Asia-Pacific shares outside Japan
eased 0.2 percent after falling to a 6-1/2-month
low on Wednesday to extend losses into the sixth straight
session, the longest losing streak since March last year.
Australian shares fell 0.3 percent after touching a
five-month low on Wednesday while South Korean shares
opened down 0.3 percent. Chinese markets reopen after being shut
from Monday to Wednesday while Hong Kong also resumes trading
after a holiday on Wednesday.
Japan's Nikkei stock average opened down 1.9
percent, extending a selloff that began on May 23 on worries
over slowing growth in China and the Fed's policy outlook. The
Nikkei scaled a 5-1/2-year high last month.
"The market is extremely sensitive with foreign exchange
levels. If the dollar nears 95 yen again, there will likely be a
sharp sell-off," said Kenichi Hirano, a strategist at Tachibana
The dollar index, measured against a basket of six
major currencies, was down 0.11 percent, staying near its lowest
since Feb. 20 of 80.748 hit on Wednesday.
Against the yen, the dollar traded down 0.5 percent at 95.53
yen after falling to a low of 95.13 on Wednesday, nearing
its two-month low of 94.975 seen on Friday. The dollar is now
down nearly 8 percent from a 4-1/2-year peak of 103.74 yen
scaled last month.
Apart from the Fed uncertainty, the BOJ's inaction on
Tuesday spurred an unwinding on short yen positions, which drove
down the greenback and the euro against the Japanese currency.
These position adjustments were exacerbated as some hedge
funds sold assets for cash ahead of their half-year book
closing, some traders said.
The CBOE Volatility Index, a gauge for Wall Street's
volatility, shot up 8.9 percent to 18.59 on Wednesday, jumping
more than 20 percent so far this week.
U.S. crude futures were down 0.3 percent at $95.56 a